One of the great things about federalism, above and beyond the fact that it both constrains the power of governments and is faithful to the Constitution, is that is turns every state into an experiment. We can learn what works best (though the President seems…
Daily Analysis
What’s the Right Point on the Laffer Curve?
Back in 2010, I wrote a post entitled “What’s the Ideal Point on the Laffer Curve?“ Except I didn’t answer my own question. I simply pointed out that revenue maximization was not the ideal outcome. I explained that policy makers instead should seek to maximize…
Another Victory for Good Fiscal Policy
Our lords and masters in Washington have taken a small step in the direction of recognizing the Laffer Curve. Here are some details from a Politico report. Here’s one Republican victory that went virtually unnoticed in the slew of budget votes last week: The Senate…
Revenge of the Laffer Curve…Again and Again and Again
If I live to be 100 years old, I suspect I’ll still be futilely trying to educate politicians that there’s not a simplistic linear relationship between tax rates and tax revenue. You can’t double tax rates, for instance, and expect to double tax revenue. Simply…
Let’s Enjoy a Victory – even if Temporary – in the Fight against More Bloat at the International Monetary Fund
I remember reading someplace that cockroaches were the only animals that would survive a nuclear war. I have no idea if that’s true, but it appears that international bureaucracies have similar survival skills. But I’m digressing. Here’s the situation. The IMF has…
Targeting Multinationals, the OECD Launches New Scheme to Boost the Tax Burden on Business
I’ve been very critical of the Organization for Economic Cooperation and Development. Most recently, I criticized the Paris-based bureaucracy for making the rather remarkable assertion that a value-added tax would boost growth and employment. But that’s just the tip…
Belgium Must Be Hopeless if Politicians from Brussels Are Criticizing Germany for Being too Capitalistic
I’m not a big fan of the German government. Angela Merkel has a disturbing desire to impose fiscal and political union on the European continent. And even the supposedly free market Free Democratic Party seems perfectly comfortable with a gradual descent into statism….
(Almost) Everything You Ever Wanted to Know about the Fiscal Policy Debate in a Single Chart
I’m a sucker for a good flowchart because they either can help to simplify analysis or they can show how something is very complex. Some of my favorites include: This explanation of double taxation. This depiction of the no-win Greek economic crisis. Portrayals of…
The Laffer Curve Bites Ireland in the Butt
Cigarette butt, to be more specific. All over the world, governments impose draconian taxes on tobacco, and then they wind up surprised that projected revenues don’t materialize. We’ve seen this in Bulgaria and Romania, and we’ve seen this Laffer Curve effect in…
If Obama Wants More Tax Revenue, He Should Lower the Corporate Tax Rate
Regular readers know that I’m a big advocate of the Laffer Curve, which is the common-sense notion that higher tax rates will cause people to change their behavior in ways that reduce taxable income. But that doesn’t mean “all tax cuts pay for themselves.” Yes, that…